Last Thursday’s signals produced a losing long trade from the bullish inside candlestick on the hourly chart which rejected the support level identified at 0.6789.
Today’s NZD/USD Signals
Risk 0.75%.
Trades must be taken between 8am New York time Monday and 5pm Tokyo time Tuesday.
Short Trades
- Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6856, 0.6867, or 0.6895.
- Put the stop loss 1 pip above the local swing high.
- Adjust the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
Long Trades
- Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6804 or 0.6789.
- Put the stop loss 1 pip above the local swing high.
- Adjust the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
NZD/USD Analysis
I wrote yesterday that the problem for bears was that we had a couple of support levels below which may be too strong to break down immediately. However, the fact that the price had not recovered very strongly from the previous day’s fall suggested that the bearish move was not over yet.
I was ready to take a bearish bias if the price can close below 0.6765 for a couple of consecutive hours. It never did. I was right in seeing lower prices, but also right in waiting for a break of 0.6765 as it never happened and then the price later rose.
I can see the price as equally likely to move in either direction, being currently positioned right in the middle of a fairly wide range between support and resistance. I think a strong reversal later from any of the nearby levels might be a good trade, but I have no directional bias.
There is nothing of high importance due today concerning the NZD. Regarding the USD, there will be a release of Retail Sales data at 12:30pm London time followed by ISM Manufacturing PMI at 2pm.